China Visa News A Positive, But Local Economic Confidence Low

USD/THB sits modestly lower for the Monday session, the pair last near 35.60, around 0.10% stronger in baht terms versus end onshore levels on Friday (earlier lows came in at 35.52). Broader USD gains against the rest of EM Asia FX has likely waned on appetite for the baht. Still, we sit off highs from last week (35.88), while a cluster of EMAs sits further south, the 20-day the closest at 35.33.

• News of a new visa agreement between China and Thailand is a positive for the FX, all else equal. The visa exemption program will start from March 1, and onshore media in China are stating it will lead to a sharp rise in arrivals from China (see this link).
• Still, domestic economic confidence remains low, per a weekend survey, with the majority of respondents stating the nation is in an economic crisis (see this BBG link). This will fuel expectations of easier policy settings.
• Higher oil prices will be another headwind, like elsewhere in the region. Local stocks have drifted sideways in recent sessions, remaining above recent lows. Offshore investors sold -320.1mn of local sahres last week.